The European Commission is seeking Belgium’s approval to launch an EU-wide loan to Ukraine backed by frozen Russian assets. But Prime Minister Bart De Wever is demanding additional legal guarantees, citing fears of potential lawsuits from Moscow and risks to Belgium’s budget.
The Commission is holding fast-track talks with the Belgian government to secure a €140 billion loan for Ukraine, intended as part of a wider reparations package before Kyiv’s reserves are depleted by spring. However, Prime Minister De Wever is preoccupied with a domestic budget crisis, and the possible involvement of the European Parliament in reviewing the loan — which could delay its approval — further reduces the chances of a timely deal.
The next round of negotiations on the loan, which would be financed through frozen Russian state assets held in Belgium, is scheduled for Friday morning. Officials from the European Commission’s economic and budget departments plan to assure Brussels that all financial and legal risks have been accounted for.
De Wever is effectively blocking the launch of a pan-European loan designed to give Kyiv three years of fiscal breathing room. Ukraine faces a budget deficit of roughly $60 billion over the next two years, excluding defense spending. If the deal collapses, EU leaders will have to find the funds within their own national budgets to sustain Ukraine’s defense — or accept the risk of Kyiv falling under Moscow’s control.
Belgian Prime Minister Bart De Wever.
The Commission’s goal is to allay De Wever’s concern that Belgium could be forced to compensate Moscow if the war ends or if Kremlin lawyers win a court case over the use of frozen assets managed by the Brussels-based depository Euroclear.
One EU official, speaking on condition of anonymity, said talks would continue in the coming days at all levels, including the highest. However, they are taking place amid a domestic crisis: Belgium’s ruling coalition is struggling to agree on a budget and fulfill its pledge to cut spending by €10 billion.
On Thursday, October 6, De Wever said he had asked King Philippe to give the government until Christmas to reach a budget agreement after several missed deadlines, stressing that this was the coalition’s last chance to find a compromise.
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Without Belgium’s Consent, the European Commission Cannot Launch the €140 Billion Loan on Which Ukraine’s Financing Depends by Spring
Once Belgium receives the necessary guarantees, the European Commission plans to formally introduce the legislative initiative for the reparations loan in the coming weeks, according to two informed sources. Two other EU officials said the European Parliament will likely be involved in drafting the document — a step that could delay the process and jeopardize the Commission’s goal of securing the €140 billion by April, when Ukraine is expected to run out of financial reserves.
Additional pressure comes from the fact that continued IMF support for Ukraine directly depends on the EU loan. “The longer the delays continue, the more difficult the situation will become,” EU Commissioner for Economy Valdis Dombrovskis said in Sofia. “It could force us to look for temporary solutions. So the sooner, the better.”
Belgium is demanding that EU member states provide national guarantees totaling more than €170 billion, which could be immediately activated if necessary. De Wever is also insisting on legal assurances that the use of frozen Russian assets will comply with international law. According to Dombrovskis, the Commission’s lawyers have “carefully examined all possible legal risks and consider them limited.” He added that the guarantees offered to Belgium should cover any potential financial losses if Kremlin lawyers file a lawsuit against the government.
Under the plan, national guarantees from EU member states are to remain in force for at least the next two years, after which they will be replaced by a pan-European guarantee in 2028, when the new seven-year EU budget takes effect.
A more complex challenge is eliminating the threat of vetoes on sanctions from Kremlin-friendly countries, including Hungary and Slovakia. The European Commission is considering a legal workaround that would keep Russian state assets frozen until Moscow ends the war and pays reparations to Ukraine. Otherwise, the EU must unanimously renew sanctions against Russia every six months, and lifting them would force Euroclear to return all blocked funds to the Kremlin.